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Unformatted text preview: Economics 102 Spring 2006 Homework #1 1. Find the following line. This line crosses the line y = ½ x -1 at x = 4. It crosses the line y = ½ x + 1 at x = 6. Write down the line in slope-intercept form. 2. State whether each statement is normative or positive. a. Alan Greenspan’s work at the Fed has helped smooth the U.S. business cycle. b. All professional economists do not know how to ride a bicycle. c. All African countries should adopt free trade policies. 3. The countries of Glock and Crock produce guns and butter. The following graph is a graph of their production possibility frontiers. Should either country specialize in their production? If so, how and why? If not, how come? 4. The states of Michigan and Wisconsin are jointly holding an international fishing tournament in Lake Michigan. In preparation for the tournament Lake Michigan must be cleaned of pollution and zebra mussels. Both of these tasks are equally important. Michigan, the “Great Lakes State” is able to clean 2,000 pounds of pollution or exterminate 500 zebra mussels...
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